How Saudi Arabia is reshaping transportation infrastructure amid climate change challenges

A 2022 report by the King Abdullah Petroleum Studies and Research Center, titled ‘Mitigating Transportation Emissions in Saudi Arabia,’ revealed that the transportation sector accounts for 33.33 percent of global energy consumption. (SPA)
A 2022 report by the King Abdullah Petroleum Studies and Research Center, titled ‘Mitigating Transportation Emissions in Saudi Arabia,’ revealed that the transportation sector accounts for 33.33 percent of global energy consumption. (SPA)
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Updated 20 January 2024
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How Saudi Arabia is reshaping transportation infrastructure amid climate change challenges

How Saudi Arabia is reshaping transportation infrastructure amid climate change challenges
  • Strategically positioned between Europe and Asia, Saudi Arabia boasts an extensive network of operational facilities

RIYADH: In the face of escalating climate change challenges, Saudi Arabia is spearheading a transformation of its transportation sector with a series of groundbreaking initiatives.

As the Middle East and North Africa region grapples with surging population growth, rapid urbanization, and a burgeoning middle class, the strain on existing infrastructure and transportation networks has reached critical levels.

In response, Saudi Arabia is not only addressing these challenges head-on but also setting a compelling example for the world.




A 2022 report by the King Abdullah Petroleum Studies and Research Center, titled ‘Mitigating Transportation Emissions in Saudi Arabia,’ revealed that the transportation sector accounts for 33.33 percent of global energy consumption. (SPA)

According to the World Bank’s 2020 findings, the region requires annual investments of at least $100 billion for the next five to ten years. These investments are essential to sustain existing infrastructure and address sector bottlenecks.

Saudi Arabia, strategically positioned between Europe and Asia and playing a central role in the global energy market, boasts an extensive network of operational facilities.

A 2022 report by the King Abdullah Petroleum Studies and Research Center, titled “Mitigating Transportation Emissions in Saudi Arabia,” revealed that the transportation sector accounts for 33.33 percent of global energy consumption, ranking second only to the industrial sector.

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$100bn

According to the World Bank’s 2020 findings, the region requires annual investments of at least $100 billion for the next five to ten years. These investments are essential to sustain existing infrastructure and address sector bottlenecks.

Despite this, ongoing price controls and efficiency improvements aim to reduce the Kingdom’s annual transport emissions growth rate from 7 percent historically to 3 percent by 2030.

By 2030, carbon dioxide emissions from transportation are projected to reach 184 million tons.

Saudi Arabia is actively pursuing three major policy interventions, as outlined in a 2022 report by the Saudi Ports Authority, also known as Mawani, titled “Enabling Growth and Innovation Across the Saudi Maritime Sector.”




Abdulla Elyas, Co-founder of Careem

The first initiative focuses on transitioning new car sales to electric vehicles, with a goal of having these make up 30 percent of all automobiles in Riyadh by 2030.

The second policy centers on electrifying public transport vehicles, while the third employs incentive programs to steer consumers toward sustainable alternatives to private cars.

Saudi Arabia is building larger and more sustainable transport networks that will help reduce congestion and emissions.

Abdulla Elyas, Co-founder of Careem

Over the years, Saudi Arabia has taken major steps toward diminishing emissions and rationalizing energy demand.

Since 2015, the Kingdom has implemented domestic energy price reform as well as fiscal reform under the Fiscal Balance Program, the Mawani report revealed.

This works on making energy consumption more sustainable while boosting government revenues by raising energy prices, evident by the gradual surge in fuel prices in the country.

ENOWA, a subsidiary company of NEOM responsible for managing the giga-project’s sustainable energy and water systems, offers one demonstration of how Saudi Arabia is choosing to partner with nature in an attempt to boost its environmental practices.

“By harnessing the abundant sun and wind resources within NEOM, coupled with innovative storage solutions and smart grid technologies, ENOWA aims to scale energy generation in NEOM and spearhead the global supply of competitively priced power, reconfiguring the energy landscape prioritizing sustainability and affordability.” ENOWA CEO Peter Terium told Arab News.

ENOWA plays a fundamental role in infrastructure development in the Kingdom.




Peter Terium، ENOWA CEO

The company aspires to shape a sustainable and efficient energy landscape that significantly impacts all sectors of the economy including transportation, construction, and industrial manufacturing as well as water and waste treatment.

Meanwhile, the planned city of NEOM serves as a prime example of the Kingdom’s commitment to transforming transportation, mobility, and infrastructure to address climate change concerns.

ENOWA aims to scale energy generation in NEOM and spearhead the global supply of competitively priced power, reconfiguring the energy landscape prioritizing sustainability and affordability.

Peter Terium, ENOWA CEO

NEOM Mobility is revolutionizing the way individuals connect and travel by transforming the planned city into a sustainable, shared, and seamless experience via air, land, and sea.

Another activity that is gaining popularity in the Kingdom with regards to transportation while taking into consideration climate change is ride-hailing.

The two companies active in this area in Saudi Arabia are Careem and Uber, with the former launching in 2013 before expanding to reach 26 cities across the Kingdom.

“Saudi Arabia is building larger and more sustainable transport networks that will help reduce congestion and emissions,” co-founder of Careem Abdulla Elyas told Arab News.

Careem is helping to connect these networks through ride-hailing and micro mobility, Elyas explained.

He added: “Today, Saudi residents and visitors use Careem for a reliable, convenient, and stress-free everyday commute in and around their cities.”

When talking about future plans that are hinged on being eco-friendly and green, Elyas revealed the company’s Careem Bike launch.

“Launching Careem Bike in Madinah in partnership with ALMQR Development Co. is the next chapter of our journey to enhance mobility,” Elyas disclosed.

“We’re proud to support Saudi’s agenda for sustainability and the Vision 2030 goal of elevating quality of life in the Kingdom,” he added.

According to the co-founder, the docked bike stations in Madinah can be accessed with just a click of a button and are well connected to public transport and key landmarks.

“The Madinah Municipality has built 70 km of bicycle paths along main roads and inside residential neighborhoods,” he stressed.

Elyas further noted: “Careem Bike is a great option for first-mile and last mile connectivity - for example traveling from a train or bus station to one’s home or offices.”

Bikes can also be used for longer trips, and this is the benefit of having a large network of stations across a city, he clarified.

"Cycling is a great source of exercise and leisure for families and friends. We can already see how much people in Saudi enjoy spending time cycling and we’re excited to help encourage even healthier, more active lifestyles through our new network in Madinah,” Elyas highlighted.

“The service is inclusive and accessible for all. Customers can purchase a pass for their preferred use – daily, weekly, monthly, or yearly. Each pass offers unlimited 45-minute access,” he underlined.

Saudi Arabia’s sustainable transport plans are a vital part of the Kingdom’s drive to reduce global carbon emissions by 4 percent, said a government official speaking at the Global Sustainable Transport Forum held in Beijing from Sept. 25-26 2023.

At the time, the Saudi Transport and Logistics Services Minister, Saleh bin Nasser Al-Jasser, stressed that sustainability is a fundamental element of the Kingdom’s Vision 2030.  

Al-Jasser underscored during his speech that the Kingdom’s strong commitment to sustainability has been smoothly incorporated into the National Strategy for Transport and Logistics.     

The plan includes reducing carbon emissions per person by 2 percent in a year, increasing sustainable mobility, electrifying transport and implementing them across the logistics value chain.

It also includes developing the necessary infrastructure to meet future demand, with the primary goal of minimizing traffic fatalities, the minister added at the time.

Under the ambitious Saudi Vision 2030 reforms, in conjunction with the National Transformation Program and the National Industrial Development and Logistics Program, the government is poised to inject $133.3 billion into the development of vital infrastructure, including ports, airports, and railways, all the way through to 2030.

This substantial financial commitment underscores Saudi Arabia’s dedication to reducing carbon emissions, with a strong focus on environmental responsibility as it brings these transformative projects to fruition.

 


Riyadh prepares to host special meeting of World Economic Forum

Riyadh prepares to host special meeting of World Economic Forum
Updated 22 April 2024
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Riyadh prepares to host special meeting of World Economic Forum

Riyadh prepares to host special meeting of World Economic Forum
  • The aim of the gathering is to find solutions to global challenges relating to humanitarian issues, the climate and the economy

RIYADH: Final preparations are taking place this week in the Saudi capital, Riyadh, for a special meeting of the World Economic Forum in the city on April 28 and 29.

Heads of state and senior executives from the public and private sectors are expected to be among the participants, who will discuss a range of global economic issues and developments under the theme “Global Collaboration, Growth and Energy for Development.”

The aim of the meeting is to find solutions to a host of global challenges relating to humanitarian issues, the climate and the economy. On the sidelines of the main event, the Kingdom will host exhibitions and other events to highlight the latest developments and trends in areas such as sustainability, innovation and culture.

The selection of Riyadh as host of the special meeting reflects the extensive partnership between Saudi Arabia and the WEF, officials said.


ACWA Power inks deal to drive renewable energy development in Azerbaijan 

ACWA Power inks deal to drive renewable energy development in Azerbaijan 
Updated 22 April 2024
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ACWA Power inks deal to drive renewable energy development in Azerbaijan 

ACWA Power inks deal to drive renewable energy development in Azerbaijan 

RIYADH: Saudi energy giant ACWA Power is signing a new agreement to accelerate the development of renewable projects in Azerbaijan. 

The private water desalination company, known for its extensive green hydrogen storage capacity, announced it has now finalized an agreement with SOCAR, the State Oil Company of the Azerbaijan Republic.

This development follows an initial cooperation understanding signed in February 2023.

This deal focuses on the joint evaluation of the “Low-Carbon/Green Fertilizer” project, in which the two bodies will collaborate on assessing the production of green hydrogen to support the decarbonization of SOCAR downstream assets.

Marco Arcelli, CEO of ACWA Power, said in a statement, “I am proud to announce our collaboration with SOCAR to ignite a new era of renewable energy development in Azerbaijan. With our shared vision and commitment to sustainability, this partnership will not only drive innovation but also pave the way for a cleaner and brighter future for this country.”

The primary directive of the agreement will be to enhance SOCAR’s carbamide fertilizer facility, striving toward more value-added low-carbon products.

As part of the project, SOCAR and ACWA Power will conduct feasibility studies to assess the potential production and sale of green fertilizers, aligning with Azerbaijan’s vision of achieving a clean environment.

ACWA Power will take a role in driving the project’s renewable energy and green hydrogen production aspects, bringing their expertise to bear on this initiative.

For his part, Anar Mammadov, vice president of SOCAR, said, “Azerbaijan is committed to building a sustainable future, and our partnership with ACWA Power underscores our shared dedication to driving renewable energy development in the region. Together, we will work towards realizing our vision of a cleaner, greener Azerbaijan.”

He added: “The cooperation with ACWA Power represents a significant step forward in Azerbaijan’s transition towards a low-carbon economy and underscores the commitment of both organizations to sustainable development practices.” 

Preceding this announcement, the two nations posed their intent to collaborate on renewables as Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman met with Azerbaijan’s Minister of Environment and Natural Resources Mukhtar Babayev in March.

During the meeting, the counterparts discussed opportunities for work and cooperation between their two countries in the field of climate change. 

They also talked about joint efforts to achieve the goals of the UN Framework Convention on Climate Change and the Paris Agreement, the Kingdom’s ministry said in a statement at the time.


Closing Bell: TASI edges down to close at 12,509 points 

Closing Bell: TASI edges down to close at 12,509 points 
Updated 22 April 2024
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Closing Bell: TASI edges down to close at 12,509 points 

Closing Bell: TASI edges down to close at 12,509 points 

RIYADH: Saudi Arabia’s Tadawul All Share Index closed at 12,508.93 points on Monday, losing 9.29 points or 0.07 percent. 

The parallel market, Nomu, also shed 343.96 points or 1.28 percent to end the day’s trading at 26,596.22. 

Concurrently, the MSCI Tadawul 30 Index fell 3.95 points or 0.25 percent to finish at 1,567.16. 

The main index posted a trading value of SR8.8 billion ($2.3 billion), with 74 stocks advancing and 148 declining. On the other hand, Nomu reported a trade volume of SR37.7 million. 

Al-Rajhi Company for Cooperative Insurance was the top performer on TASI as its share price surged 9.93 percent to SR126.20. LIVA Insurance Co. followed next with its share price jumping 9.92 percent to close at SR21.50. 

Gulf General Cooperative Insurance Co.  also performed well, climbing 9.16 percent to SR16.44. Raydan Food Co. and Fitaihi Holding Group increased 8.14 and 8.11 percent to SR28.55 and SR4.40, respectively. 

Conversely, Saudi Cable Co. recorded the most significant dip, declining 4.94 percent to SR75. 

Alkhaleej Training and Education Co. and Ash-Sharqiyah Development Co. also experienced setbacks, with their shares dropping to SR31.50 and SR23.40, reflecting declines of 4.83 and 4.10 percent, respectively.

Nomu’s top performer was Dar Almarkabah for Renting Cars Co., which saw a 9.73 percent jump to SR44. Mayar Holding Co. and Alqemam for Computer Systems Co. also recorded notable gains, with their shares closing at SR4.27 and SR89.80, marking an increase of 7.02 and 5.03 percent, respectively. Arabian International Healthcare Holding Co. and Foods Gate Trading Co. also fared well. 

On Nomu, Raoom Trading Co. was the worst performer, declining by 7.28 percent to SR135. Other underperformers included Natural Gas Distribution Co. and National Environmental Recycling Co., whose share prices dropped 5.58 percent and 5.23 percent to SR42.30 and SR12.32, respectively. 

Watani Iron Steel Co. and Future Care Trading Co. declined during the day to settle at SR2.81 and SR8.70, respectively. 


Saudi Aramco in talks to acquire 10% stake in China’s Hengli Petrochemical

Saudi Aramco in talks to acquire 10% stake in China’s Hengli Petrochemical
Updated 22 April 2024
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Saudi Aramco in talks to acquire 10% stake in China’s Hengli Petrochemical

Saudi Aramco in talks to acquire 10% stake in China’s Hengli Petrochemical

RIYADH: Energy giant Saudi Aramco held talks with Chinese Hengli Group Co. to acquire a 10 percent stake in its subsidiary, subject to due diligence and required regulatory clearances.

Aramco and Hengli Petrochemical Co. signed a memorandum of understanding for the proposed deal. The agreement supports the former’s strategy to increase its presence in key downstream markets, enhance its liquids-to-chemicals initiative, and ensure long-term crude oil supply agreements.

Last year, Aramco signed two multibillion-dollar agreements for liquids to chemicals investments in China.

In March 2023, a deal was signed between China’s Norinco Group and Panjin Xincheng Industrial Group to establish a joint venture to build a refinery and petrochemical complex in China’s Liaoning province. The initiative cost stands at approximately $12 billion.

The second agreement, signed in July, is an acquisition of a 10 percent stake in China-based firm Rongsheng Petrochemical Co. for $3.4 billion.

“This MoU supports our efforts to grow our global downstream footprint. We continue to explore new opportunities in important markets as we seek to progress in our liquids-to-chemicals strategy,” Mohammed Al-Qahtani, Aramco’s downstream president, said in a press release.

He continued: “We look forward to forging new partnerships and are excited by the prospect of expanding our presence in the important Chinese market.”

Hengli Petrochemical, a controlled subsidiary of Hengli Group, owns and operates a 400,000-barrel-per-day refinery and integrated chemicals complex in Liaoning province, and several plants and production facilities in Jiangsu and Guangdong provinces.

Speaking at a development forum held in March 2023 in Beijing, Amin Nasser, president and CEO of Aramco, highlighted substantial opportunities for cooperation between Saudi Aramco and Chinese partners in sectors aimed at reducing emissions.

“China has distinct strengths in renewables and critical materials, while Aramco and Saudi Arabia have a clear interest in solar, wind, hydrogen, and electrofuels. These areas have great long-term potential, and combining our strengths could match our ambitions,” he noted.

Saudi Arabia and China are working together to strengthen their already well-established strategic ties.

In September, the Kingdom’s minister of industry and mineral resources held meetings with key Chinese officials in Beijing. Bandar Alkhorayef also toured various companies and factories in different Chinese cities as part of his trip.

He held talks with China’s Vice Minister of Commerce Wang Shouwen, during which they discussed ways to boost economic collaboration and trade ties, the Saudi Press Agency reported.

The top officials also discussed investment opportunities in several economic sectors, including mining. At the time, the Saudi minister highlighted the Kingdom’s progress in the field of industries and mining.


IsDB leads multilateral development banks group in $300-$400bn lending boost target

IsDB leads multilateral development banks group in $300-$400bn lending boost target
Updated 22 April 2024
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IsDB leads multilateral development banks group in $300-$400bn lending boost target

IsDB leads multilateral development banks group in $300-$400bn lending boost target

RIYADH: A group of elite financial institutions, led by the Islamic Development Bank, is aiming to increase its lending margin by $300-$400 billion over the next decade to reduce global inequalities.

The announcement came after presidents of ten multilateral development banks met in Washington, D.C., to discuss new strategies to strengthen their impact on tackling development issues and improve coordinated efforts in 2024 and beyond.

The MDB Heads Group, of which IsDB currently holds the presidency, is seeking to expand its financing capacity by implementing the G20 Capital Adequacy Frameworks Review report recommendations as well as other initiatives.

A joint statement issued by the group, which includes African Development Bank, European Investment Bank, and World Bank Group, at the conclusion of the meeting read: “Collectively, these efforts on balance sheet optimization and financial innovation are expected to generate additional lending headroom in the order of $300 billion to $400 billion over the next decade, with strong contributions from shareholders and development partners. Related actions … have already created additional lending capacity.”

Among the actions set out to help increase funding include introducing diverse, innovative financial instruments, such as hybrid capital tools and risk transfer methods, to shareholders, development partners, and capital markets.

There will also be efforts to encourage the direction of International Monetary Fund Special Drawing Rights through the MDBs and to provide greater clarity on callable capital, helping rating agencies better assess its value.

Another area of focus seeks to boost action on climate change by presenting the first common approach for measuring environmental outcomes in terms of adaptation and mitigation, aligning operations with the goals of the Paris Agreement, and providing joint reporting on climate-related finance.

Additionally, the MDBs will engage in the UN-led process toward a new collective climate finance goal.

A third area is strengthening country-level collaboration and co-financing. The MDB heads emphasized enhancing partnership and co-financing and assessing proposals for nation-led and owned platforms to reach a common understanding.

Some MDBs will establish platforms and use one another’s procurement policies to cut transaction costs, boost efficiency, and promote sustainability.

They will also accelerate co-financing for public sector projects through the newly launched co-financing collaboration gateway.

A fourth area focuses on mobilizing the private sector, with MDBs committing to increase the division’s financing for development goals, expand local currency lending, and offer foreign exchange hedging solutions to boost private investment.

The heads agreed to develop the type and classification of statistics issued by MDBs and development finance through the Global Emerging Markets Risk Database Consortium.

Moreover, in a fifth area, MDBs agreed to emphasize impact more through enhanced collaboration in joint impact assessments.

This includes sharing approaches for measuring and monitoring outcomes, maintaining ongoing coordination efforts, and assessing key performance indicators tied to nature and biodiversity.

The statement added that the MDB group “recognize our collective duty to accelerate international efforts to eradicate poverty and hunger, reduce inequalities, tackle regional and global challenges including on climate and health, as well as boost inclusive socioeconomic development.”

It continued. “As a group, we reaffirm our determination to deliver on our commitments and continue strengthening our collaboration for the benefit of poor and vulnerable countries, communities, and people.”